Question

Ryan Company deposits all cash receipts on the day they are received and makes all cash payments by check. Ryan's June bank statement shows $24,861 on deposit in the bank. Ryan's comparison of the bank statement to its cash account revealed the following:

Deposit in transit	2,750
Outstanding checks	1,188

Additionally, a $35 check written and recorded by the company correctly, was recorded by the bank as a $53 deduction.
The adjusted cash balance per the bank records should be:

Answer 1

Answer to Question:

Particulars	Amount($)
Balance as per Bank Statement	24,861
Deposit in Transit	2,750
Outstanding Checks	(1,188)
Error by Bank($53-$35)	18
Adjusted Cash Balance as per Bank records:-	26,441

Notes:

• When a Company writes a check, there is a decrese in the Bank Account Balance. The bank decreased for $53 when it should have decreased by $35. So, error have been rectified by adjusting the difference amount upwards,i.e we need to increase cash by the difference.